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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 28, 2000
DUALSTAR TECHNOLOGIES CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 0-25552 13-3776834
(State of incorporation (Commission File Number) (IRS Employer
or organization) Identification No.)
One Park Avenue, New York, New York 10016
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (718) 340-6655
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Item 5. Other Events
On March 29, 2000, DualStar Technologies Corporation, a Delaware
corporation ("DualStar") (Nasdaq: DSTR), announced that it has entered into a
definitive securities purchase agreement with Blackacre Capital Management,
L.L.C. and certain of its affiliates and that it has entered into a definitive
agreement with M/E Contracting Corp., an affiliate of Blackacre, as more fully
described in the press release filed as Exhibit 99.1 to this Current Report on
Form 8-K. The contents of such Exhibit are incorporated herein by reference.
Item 7. Financial Statements and Exhibits
(c) Exhibits
99.1 Press Release, dated March 29, 2000.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, hereunto duly authorized.
DUALSTAR TECHNOLOGIES CORPORATION
Date: April 5, 2000 By: /s/ Robert Birnbach
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Robert Birnbach
Executive Vice President,
Chief Financial Officer and Secretary
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Exhibit 99.1
DUALSTAR TECHNOLOGIES CORPORATION NEWS
ONE PARK AVENUE, NEW YORK, NEW YORK 10016
- --------------------------------------------------------------------------------
FOR IMMEDIATE RELEASE
Contact: Robert Birnbach
Chief Financial Officer
e-mail: [email protected]
Voice: 718.340.6655
Fax: 212.616.6254
DUALSTAR SIGNS DEFINITIVE AGREEMENTS WITH BLACKACRE FOR $46.2 MILLION INVESTMENT
AND FOR $11 MILLION SALE OF ELECTRICAL AND HVAC BUSINESSES;
STOCKHOLDERS MEETING TO BE SCHEDULED AS SOON AS PRACTICABLE
NEW YORK, NY - March 29, 2000- DualStar Technologies Corporation
("DualStar" or the "Company") (Nasdaq: DSTR) announced today that it has entered
into a definitive securities purchase agreement with Blackacre Capital
Management, L.L.C. and certain of its affiliates (collectively, "Blackacre")
under which, subject to the approval of the Company's stockholders, Blackacre
would invest $46.2 million in the Company through the purchase, at Blackacre's
election, of either: (A) a $30 million ten-year convertible promissory note
("Note") bearing interest at the rate of 3% per annum, convertible into shares
of the Company's common stock at a conversion price of $4.00 per share, and
4,050,000 shares of the Company's common stock at a purchase price of $4.00 per
share; or (B) 11,550,000 shares of the Company's common stock at a purchase
price of $4.00 per share. In connection with its $46.2 million investment,
Blackacre will enter into a "strategic alliance" with DualStar under which
DualStar will be granted the right of first negotiation to acquire access rights
to deliver voice, video, data and related services to properties owned,
controlled by, managed or affiliated with Blackacre and/or its affiliates.
If the $46.2 million Blackacre investment is consummated, Blackacre will
nominate a
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majority of the members of DualStar's Board of Directors. If Blackacre fully
converts the principal under the Note (or if Blackacre elects to make its
investment solely in common stock), Blackacre would then own approximately 42.4%
of the Company's then-outstanding common stock (based on 15,701,571 shares of
common stock outstanding as of today).
In addition, the Company announced that it has entered into a definitive
agreement with M/E Contracting Corp. ("M/E"), an affiliate of Blackacre, to sell
to M/E, subject to the approval of the Company's stockholders and the
consummation of the $46.2 million Blackacre investment, DualStar's electrical
contracting subsidiary, High-Rise Electric, Inc., and DualStar's heating,
ventilation and air conditioning ("HVAC") contracting subsidiaries, Centrifugal
Associates, Inc. and Mechanical Associates, Inc. The aggregate purchase price is
$11 million, consisting of $1 million in cash and a $10 million secured ten-year
note bearing interest at 10% per annum. The definitive agreements relating to
the Blackacre $46.2 million investment and the M/E sale transactions described
above are subject to customary and other closing conditions including, with
respect to the sale to M/E, M/E's right to terminate the transaction for any
reason at any time prior to closing. DualStar has received fairness opinions
with respect to both the proposed $46.2 million Blackacre investment and the
proposed $11 million sale of its contracting subsidiaries to M/E.
The proposed investment and sale transactions with Blackacre and its
affiliate, M/E, represent DualStar's continued efforts to transform the
Company's business focus from construction-related businesses to becoming
principally an access provider of broadband telecommunications services to
residential and commercial properties. DualStar would use the proceeds from the
investment and sale transactions to repay a $7 million bridge loan from
Madeleine, L.L.C., an affiliate of Blackacre, and for working capital purposes,
including the expansion of its broadband telecommunications services business.
DualStar contemplates that its 1999 annual meeting of stockholders meeting,
which was
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previously postponed, will be rescheduled as soon as practicable after
Securities and Exchange Commission clearance of the Company's preliminary proxy
statement in respect of the proposed investment and sale transactions described
above and related matters, including the Company's proposal to increase the
number of its authorized shares of common stock from 25 million to 50 million
shares. Stockholder approval for the increase in the Company's authorized shares
is a condition to the $46.2 million Blackacre investment.
Blackacre and its affiliates manage funds and accounts of over $5.5
billion. Blackacre and its fund management affiliates are headquartered in New
York City and focus on investments in companies, real estate, asset-based
lending and related investment opportunities in the United States, Europe and
Asia. Its investment staff includes professionals with operating, investment and
management experience. Moreover, their sizeable portfolio has led to
relationships with an extensive array of industry owners and operators used to
identify and evaluate investment opportunities and operate their portfolio
companies. Blackacre has interests in more than 70,000 residential units and
10.2 million square feet of commercial space. Affiliates of Blackacre also own a
majority of the equity of Starrett Corporation, which through certain of its
affiliates is engaged in the general construction, property management and real
estate development business, principally in the New York metropolitan area.
DualStar Technologies Corp., through its subsidiaries, designs and installs
infrastructure systems and provides services that control and enhance the
environment in buildings. These systems and services include: heating,
ventilation and air conditioning (HVAC); electrical; building and energy
management (BMS); enhanced local, regional and long distance telephony as a
Competitive Local Exchange Carrier (CLEC); direct broadcast satellite (DBS) and
cable television as a System Operator; high-speed Internet access as an Internet
Service Provider (ISP); and security and safety. DualStar created and owns many
innovative trademarked concepts, including the CyberBuilding(Registered
Trademark), CyberCierge(Registered Trademark), Building Area Network(Registered
Trademark) (BAN), Home Area Network (HAN), Community Area Network (CAN),
InfoStructure, InfoStructors, CyberView(Registered Trademark),
CyberBuilders(Registered Trademark), DualStar(Registered Trademark), DualStar
Communications(Registered Trademark) and DualStar Technologies(Registered
Trademark). For
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more information, visit the Company's Web site at http://www.dualstar.com,
e-mail [email protected], or call (718) 340-6655. The Company's common stock is
traded on The Nasdaq National Market under the symbol DSTR.
This press release and the materials referred to hereby contain
forward-looking statements regarding the Company's business and future plans of
operations. When used herein, the words "intends," "expects," "plans,"
"estimates," "projects," "believes," "anticipates," "contemplates," "represents"
and similar expressions are intended to identify forward-looking statements.
Forward-looking statements involve known and unknown risks and uncertainties.
These and other important factors, including those set forth in the Company's
Annual and Quarterly Reports on Form 10-K and Form 10-Q (available to the public
at www.sec.gov), may cause the actual results and performance to differ
materially from the future results expressed in or implied by such
forward-looking statements. The forward-looking statements contained in this
press release speak only as of the date hereof and the Company disclaims any
obligation to provide public updates, revisions or amendments to any
forward-looking statements made herein to reflect changes in the Company's
expectations or future events.
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